The Small Business Administration has issued four final rules this week that drastically increase the size standards for determining which companies may be eligible to receive SBA benefits, allowing larger companies to now qualify for government contracts.

The rules, which become effective July 22, increase the size standards for 70 industries, making more than 17,000 additional companies eligible for SBA benefits.  

The SBA's size standards define the maximum size a firm can be and still be considered a small business to be eligible for loan and federal procurement programs. The revised standards reflect changes in marketplace conditions and public comments that SBA received to the proposed rules. The last comprehensive review of size standards was during the late 1970s and early 1980s.

In many industries, the size changes are dramatic. In the commercial banking and credit card issuing, for example, the SBA increased size standards from $175 million to $500 million in total assets. In several other industries in the finance and insurance sector—such as securities brokerage, commodity contracts dealing, and investment banking and securities dealing—SBA increased size standards from $7 million to $35.5 million.

A breakdown of the revised size standards follows:

In Agriculture, Forestry, Fishing and Hunting (Sector 11), more than 7,800 additional firms for 11 industries will now qualify for SBA benefits.

In Arts, Entertainment and Recreation (Sector 71), more than 1,450 additional firms for 17 industries will now qualify for SBA benefits.

In Support Services for Mining (Subsector 213) within the Mining, Quarrying and Oil and Gas Extraction Sector (Sector 21), more than 475 additional firms will now qualify for SBA benefits.

In Finance and Insurance (Sector 52) and two industries in the Management of Companies and Enterprises (Sector 55), more than 7,400 additional companies for 36 industries will now qualify for SBA benefits.

In addition, SBA changed the basis for measuring size from assets to annual revenues for the International Trade Financing industry and removed the Real Estate Investment Trusts from its table of size standards. 

The SBA said it will continue reviewing size standards “for the next several years” as part of the Small Business Jobs Act of 2010. In assessing size standards, the SBA takes into account the structural characteristics of individual industries, including average firm size, the degree of competition, and federal government contracting trends.

Those wishing to submit comment on the rules can do so at www.regulations.gov